'Sugarcane crushing in UP to start after Nov 15'

Sugar mills in Uttar Pradesh are unlikely to start cane crushing before November 15 due to dispute over price that factories will pay to farmers, a growers’ body said today.

“Mills are expected to start only after November 15 as there have been no understanding so far with mill owners on sugarcane price,” said Awadesh Mishra, the President of Chairman’s Association of cane societies in Uttar Pradesh, the country’s second largest sugar producing state.

The association is seeking Rs 320 per quintal for their cane, while mills are offering only Rs 170-180, he said, adding that growers’ would not supply cane to mills below Rs 280 per quintal.

Besides, Mishra said, the state government is yet to announce the state advisory price (SAP) for 2010-11 sugar year that started this month.

The Centre has announced Fair and Remunerative Price (FRP) of sugarcane for 2010-11 at nearly Rs 140 per quintal. FRP is the minimum price that mills have to pay to farmers for procuring their produce. SAP is higher than the central price.

In 2009-10, the state government fixed SAP at Rs 165-170 per quintal, but mills paid much higher due to shortage of cane and huge protest by farmers in November last year.

Farmers got an average price of Rs 280 a quintal last year, but few mills paid up to Rs 320, Mishra said.

Indian Sugar Mills Association (ISMA) Deputy Director General M N Rao had said last week that crushing in Uttar Pradesh is likely to begin in the first week of November because of late rains.

Earlier, he had said that it would not be feasible for the mills to pay last year’s price as sugar prices have fallen by 40 per cent since January this year.

Sugar is currently being sold at Rs 30 a kg in retail market of the national capital, a sharp drop from Rs 48 in mid-January.

According to ISMA estimates, Uttar Pradesh would produce around 7 million tonnes of the sweetener in the current sugar year ending September, 2011 against about 5 million tonnes in the previous year.